There are 19 excise duties that weigh on the price of fuel, which together with the surge in oil are bringing the price of petrol, diesel, LPG and CNG to unknown levels. What do they finance? We explain it in detail
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andrea_cake
12 March
– milano
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Full of fuel increasingly expensive for motorists, who are paying for the flare-up of oil and natural gas prices soaring due to international tensions. On petrol, diesel, LPG and methane cars, however, also taxes, VAT and excise duties which represent a substantial percentage of the prices at the pump. Excise taxes on fuels have always been a controversial and debated issue, which affects anyone with a motor vehicle. Balzelli so hated that they are the favorite target of motorists, but also a theme typically associated with electoral campaigns, often seasoned with promises – never kept – of reductions or total cancellations. The reality – however – is that excise duties resist election announcements because they guarantee fundamental revenue for the public purse. And that, in the price composition final paid by motorists for the full, represent a very substantial part.
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WHAT ARE EXCISE DUTIES ON FUELS?
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The term excise duty indicates a tax on the manufacture and sale of consumer products. Those on fuels are the taxes on petrol, diesel, LPG and methane used for motor vehicles introduced to meet cash needs not necessarily connected to the world of petroleum products. This is not an Italian exclusive, of course, because they exist all over the world, especially in non-oil producing countries. These are taxes introduced to deal with emergencies such as earthquakes, crises such as migration from Libya or to finance international peacekeeping missions and government measures such as the “Save Italy” decree of 2011. There is even a ‘excise duty on the war of Ethiopia of 1935-1936, the first to be introduced in Italy and technically still active. Most of the excise duties on fuels would no longer have a reason to exist, since the reasons that had decreed the need for them have lapsed: the war in Ethiopia is over for a long time, the international crises largely overcome as well as the emergency management natural disasters occurred over decades. Yet, the excise duties on fuels in Italy are still in place, incorporated since 1995 into a single undifferentiated excise duty with no more references to the original reasons, a condition that makes it impossible even to selectively abolish some of them.
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HOW MUCH ARE THE EXCISE DUTIES ON FUELS?
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So far the story, but today how much are the excise duties on fuels worth to the state? To answer the question, there are three different factors to bear in mind: the many levies introduced between 1936 and the choice of differentiating excise duties according to the type of fuel. Then, it should be added that – in addition to excise duties – the 22% VAT is also borne on fuels, which is not calculated only on the net price but also on heavy taxes. A tax on taxes, therefore. The value of the excise duties on fuels is determined by the Excise, Customs and Monopoly Agency, set up and one of the tax agencies that carry out the technical-operational activities once the responsibility of the Ministry of Finance. The amounts of excise duties for 2022 are those specified in the agency document, differentiated according to the type of fuel:
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- petrol: 728.40 euros per 1000 liters;
- diesel: € 617.40 per 1000 liters;
- LPG: 138.72 per 1000 liters (applying a conversion of 520 kg / m3);
- methane: € 4.93 per 1000 kg (applying a conversion of 1.49 kg / m3).
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The tax revenue generated by excise duties estimated for 2021 amounts to 23.6 billion euros, down from the 26 billion reached in 2017 – the effects of the pandemic which reduced fuel consumption were felt – to which must be added the VAT revenue forfeited from voracious public finances. It is difficult to think of a reduction in the tax burden.
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19 EXCISE
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There are 19 excise duties on fuels that weigh on the pockets of Italian motorists. To these must be added the 22% VAT, making up 64% of the total price of fuel. The use of this tool has seen an acceleration over the years: in sixty years – between 1936 and 1966 – nine excise duties were introduced, the other ten in just ten years, between 2004 and 2014. 2011 four were introduced. Below is the complete list of excise duties on fuels in Italy: 1) financing for the war in Ethiopia (1935 – 1936) – 0.000981 euros; 2) financing of the Suez crisis (1953) – 0.00723 euros; 3) post-disaster reconstruction of the Vajont (1963) – 0.00516 euros; 4) post-flood reconstruction of Florence (1966) – 0.00516 euros; 5) post-earthquake reconstruction of Belice (1968) – 0.00516 euros; 6) post-earthquake reconstruction in Friuli (1976) – 0.00511 euros; 7) post-earthquake reconstruction of Irpinia (1980) – 0.0387 euros; 8) funding for the UN mission in Lebanon (1982 – 1983) – € 0.106; 9) funding for the UN mission in Bosnia (1996) – 0.0114 euros; 10) renewal of the autoferrotranvieri contract (2004) – 0.020 euros; 11) purchase of ecological buses (2005) – 0.005 euros; 12) post-earthquake reconstruction of L’Aquila (2009) – 0.0051 euros; 13) funding for culture (2011) – 0.0071; 14) Libyan migration crisis financing (2011) – 0.040 euros; 15) post-flood reconstruction in Tuscany and Liguria (2011) – 0.0089 euros; 16) financing of the “Salva Italia” decree (2011) – 0.082 euros; 17) post-earthquake reconstruction of Emilia (2012) – 0.024 euros; 18) financing of the “Manager bonus” (2014) – 0.005 euros; 19) financing of the “Fare decree” (2014) – 0.0024.
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NO EXCISE DUTY ON ELECTRICITY FOR SELF-TRACTION
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If motorists who drive thermal or hybrid cars are affected by excise duties on fuels, the same cannot be said for those who have opted for electric mobility. At the moment, in fact, there is no additional tax for the electricity taken from the network and used to recharge a zero-emission vehicle, net of excise duties that are paid by any user. Some rumors about an excise tax on electricity for automotive use have circulated several times, we will continue to keep an eye on this possibility.
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